Every big thing is achieved by the small beginning. So, to build an empire in financial stability, your monthly expense management will be the root cause. Managing monthly expenses is an art of financial planning.
Have a Proper Monthly Budget Planner:
This might be surprising, as we recommend writing the monthly budget. Yes, there is power in writing anything. That has a connection to our subconscious mind.
We should have to plan a budget every month to have perfect financial planning.
We must categorize the budgets into needs, wants, savings, and loans. So it will be easy for us to find the financial allocation.
Please find the sample copy of the monthly budget. You can download, edit, and use it for financial planning. Monthly budget
Validate Plan VS Actual Monthly Budget Planner:
It is very easy to write a budget. But the most important thing is to check the plan and actual expenses.
Always have a small notepad in your hand. And, write even the small expenses you do an update in your budget note by month-end.
Always analyze with plan and actual. This will give you an idea of where you will spend over the plan. Also, 12 monthly analyses will make your financial planning very strong.
Pay All Your Bills on Time:
Every month we will be receiving some bills like mobile and Internet postpaid bills, current bills, credit, and loan EMI.
Pay all your bills and EMI on time to avoid late fees, which also impacts monthly savings and investments.
Set all your bills to be paid by 1-5th of every month. Also, set an auto-debit option for paying bills.
Don’t Commit Anything Out of Budget:
This is the most crucial part of managing budgets. We plan our budget with full care and attention.
When we see advertisements or offers in stores, or online shops we tend to buy them instantly. This we have spoked already under instant gratification.
As a family, decide on the budget and also plan in writing on the shopping items, and buy as you wrote. Never see for other items than on the list.
Autosave on Day 1:
The first part of financial planning in the monthly budget is savings. Most of us plan savings, but we fail to do as per plan.
This is because of having a mindset of saving after all our expenses. This strategy will not make us financially free.
To make proper discipline, subscribe to all your investments over an auto-debit option on 1st day of every month.
Reduce your credit card expenses:
We don’t advise credit cards. In fact, you use, be very cautious with the usage.
Try to minimize the expenditure using credit cards month on month. Figure out how much you send per month. Analyze in what percentage we depreciate the expenditure of credit cards.
Credit cards are harmful to financial planning. So, avoid using them as quickly as possible.
Cancel All the Unused Subscription:
We tend to subscribe to products annually when we see that would benefit us. But, reality always differs from what we expect.
Most people have the habit of joining the gym as a New Year’s resolution and will pay the annual subscription. Gym owners know their real market is in the New Year period. So, they post a few offers on annual charges and they earn.
We go to the gym for a month or two months and due to some circumstances, we quit. This happens with 90% of people.
In the same way, we subscribe to magazines, newspapers, etc.
If we find these subscriptions are not used properly, please unsubscribe for the following years and save.
AVOID OFFERS:
When you plan your life for financial stability and a monthly budget. The first thing you should say is bye to offers. Business planners know how to attract people for their growth.
They sell the product at the same cost it is meant to be but under the banner of offers. At the same time, they sell you two or three products.
These offers can cause a bleed in our financial planning, and there is no medicine to cure it. Prevention is better than cure.
Go by walk for Nearby Shops:
If the shop is located 2-3 kilometres near us, don’t take a car or bike to navigate towards for purchase. Take a walk.
Petrol rates are at a high price nowadays; we can save more money and increase our investment portfolio.
There are two benefits. One is wealth, and the other is health which we gain from walking.
Use RD for saving Yearly Payments
This means in the case of insurance premiums, you have to pay annually. Let us say health insurance. The specific month’s budget will become a burden if we pay in a single shot.
Despite this, you can divide the same amount into 12 and save every month. You can use recurring deposits and earn some investment interest.
Conclusion:
The above-mentioned 10 ways of making a monthly budget will help us have healthy financial planning.
We hope you all will follow the steps and have a disciplined way of budgeting, analyzing, and rectifying the mistakes made over the past.
I wish you all a financially free lifestyle soon.